A significant fraction of all eukaryotic genomes is composed of sequences derived from the reverse transcription of RNA. The integration of these elements results in spontaneous insertional mutations and their combined accumulation has played a significant role is shaping the size, structure and function of eukaryotic genomes. For example, nearly 40% of the human genome is composed of these reverse transcripts. The machinery largely responsible for these insertions is that encoded by the non-long terminal repeat (non-LTR) retrotransposable elements. One of the best characterized non-LTR elements, and the only element in which detailed in vitro studies are being conducted, is the R2 element. The single protein encoded by R2 cleaves its chromosomal target site and polymerizes the reverse transcript directly onto this site. One specific aim of this proposal is to continue the characterization of the R2 retrotransposition mechanism with emphasis on the means by which the R2 protein specifically binds its own RNA template and positions this template for reverse transcription. R2 elements specifically insert into the 28S rRNA genes of their host. In Drosophila, these insertions are frequently co-transcribed with the 28S rRNA but then rapidly degraded. Because ribosome structure and assembly are similar in all eukaryotes, an expression system in yeast will be developed to study the assembly and processing of R2/28S rRNA subunits. The second aim is to determine whether such subunits can serve as biologically relevant templates for R2 integration. A critical issue in the study of any transposable element is regulation. Strains of Drosophila have been identified in which R2 activity has been documented. The third aim of the proposal is to compare R2 transcription, RNA processing and translation in these active strains to that of inactive strains with special emphasis on determining when in germ line development R2 retrotransposition events occur. The last aim is to begin a genetic analysis of R2 activity by determining whether factors involved in its control map to the rDNA locus itself. The rDNA locus, and the nucleolus that assembles about it, plays a key role in many aspects of cellular metabolism. R2 elements are so directly integrated into the structure and regulation of the rDNA locus that their study should provide important insights and useful tools to study the rRNA genes.